“Data Breach Costs at its Peak in 17 years in a Pandemic”: Says IBM

IBM security report says that the cost of data breach reaches highest in 17 years in this pandemic.

Ponemon Institute's 'The Cost of a Data Breach Report,' sponsored and analyzed by IBM security, says that data-breach expenses increased over 10% in the last year, from USD3.86 million to USD4.24 million per event. It is the highest average overall cost in the 17-year history of this study, as well as the greatest single-year rise in the past seven years. The report was based on an analysis of real-world data breaches suffered by more than 500 organizations. The research considers a wide range of costs associated with data breaches, including legal, regulatory, and operations of technology, as well as brand equity, customer loss, and staff productivity.

The average cost of a data breach rose nearly 10% year over year, from USD3.86 million to USD4.24 million, according to IBM. However, "costs were significantly lower for some of the organizations with more mature security posture, and higher for organizations that lagged in areas such as security, artificial intelligence and automation, zero trusts, and cloud security," quoted  IBM.

According to the study from last year, data breaches cost Indian businesses an average of Rs 14 crore between August 2019 and April 2020. In the 2021 research, the average overall cost of a data breach in India was Rs 16.5 million (May 2020 to March 2021). For each data leak, Indian organizations that are in the advanced stages of embracing zero-trust deployment spend Rs 13.18 crore. For firms that are just getting started with zero-trust implementation, that amount was Rs 19.87 crore.

Security Software Sales Leader of IBM Technology Sales, India/South Asia, Prashant Bhatkal stated that security programs have been severely disrupted as a result of the fast move to remote employment. Security became an afterthought as businesses concentrated ongoing online. During the pandemic, India saw a record number of data breaches, prompting many businesses to assess their security posture.

During the pandemic last year, businesses were obliged to swiftly modify their technology, with many firms encouraging or forcing workers to work from home, and 60% of enterprises going deeper into cloud-based operations.

Phishing, hostile insiders, and physical security penetration were the top three cyber-attack vectors for data breaches. The average mean time for organizations with less than 50% remote work adoption to identify a data breach was 208 days and the average mean time to contain a data breach was 72 days, while organizations with more than 50% remote work adoption took 271 days to identify a data breach and 83 days to contain a data breach. According to the IBM security report, the average time to detect a data breach grew from 230 to 239 days, but the average time to control a data breach reduced from 83 to 81 days.

IBM Security Report analyses  the following:

Impact of Remote Work: 

During the pandemic, the fast move to remote operations appears to have resulted in more costly data breaches. When remote employment was mentioned as a role in the breach, the average cost was almost USD1 million more (USD4.96 vs. USD3.89 million).

Healthcare Breach Costs Increased Dramatically: 

Industries that underwent significant operational adjustments as a result of the pandemic (healthcare, retail, hospitality, and consumer manufacturing/distribution) saw significant increases in data breach costs year over year. By far the most expensive are healthcare breaches, which cost USD9.23 million per event, up USD2 million from the previous year.

Data was Compromised as a Result of Compromised Credentials:

Stolen user credentials were the most prevalent root cause of breaches in the research, and they led to compromised data. At the same time, customer personal data (such as name, email, and password) was the most frequent sort of data exposed in data breaches, accounting for 44% of all breaches. The combination of these variables might lead to a spiral effect, with data breaches providing attackers with leverage for further data breaches.

Modern Approaches Decreased Cost:

The use of artificial intelligence, security analytics, and encryption were the top three mitigating factors proven to minimize the cost of a breach, saving organizations between USD1.25 million and USD1.49 million compared to those that did not use these technologies at all. Organizations that used a hybrid cloud strategy (USD3.61 million) had lower data breach expenses than those that used a predominantly public cloud (USD4.80 million) or a primarily private cloud (USD4.55 million) approach.